Collecting pension does not equal retirement

| 03/06/2016

Do the recent changes in the Pensions Law and the adjustment of the retirement age from 60 to 65 have the effect of extending the working years for anyone that will be 60 later this year?

Auntie’s answer: That is a really good question because the answer will probably affect – and surprise – many people. Apparently, this whole mandated retirement-age thing is actually a non-starter, though it is easy to see how it has been misinterpreted.

Once again, I must thank the very responsive people over at the Department of Labour and Pensions for their help in clarifying the issue.

First off, this time an officer explained that the relationship between employer and employee is based on the contract between them. And, most significantly, neither the National Pensions Law (2012 Revision) (NPL) nor the Labour Law (2011 Revision) stipulates that a worker must be retired at age 60. I’ll wait for that salient fact to sink in …

Next, the 2012 pensions law established a retirement age of 60 solely for the purpose of accessing pensions, but to clear up any confusion that might have (not surprisingly) caused, the National Pensions (Amendment) Bill, 2016 includes a key definition change, introducing the phrase “normal age of pension entitlement”.

The pension official explained this was done because the Ministry of Education, Employment and Gender Affairs  “has recognised employers are incorrectly treating the normal retirement age (60) in the NPL as the time when employees must stop working, which is not the intent. The age is simply the time when a member may access their pension benefits under the NPL”.

I expect this news comes as little comfort for those people who have been forced to retire at age 60, a few of whom I know personally.

I have always considered that particular so-called rule shameful, shortsighted and downright dumb since there are plenty of employees, age 60 or older, who are hardworking, valuable assets to their companies. Of course, I, like you, was operating on the assumption that there was no way around this.

So, there you have it. Work as long as you want and are able, and your employer is keen to keep you, as 60 is just another number, and should not be a death knell for your job.

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Category: Ask Auntie

Comments (6)

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  1. Anonymous says:

    The real beauty of the government retirement age of 60 was that we could finally-praise God- get rid of some of the non productive and often obstructive dead wood who had done very little in the previous 20 years (I wish I could name some for readers) and wanted to work on until they dropped down dead just to collect a government salary for doing the same nothing they had done for many many years previously. Raising the retirement age is a gift for such people and a blow for those coming up behind them who cannot get promotion because these deadwoods are blocking them.

  2. Anonymous says:

    Unfortunately government has retired its employees at 60 then taken them back on under annual contract. Costing the country $$$ millions as they are being paid a pension plus their salary after age 60. Pensions that the employee has not had to contribute to. And we wonder why everyone wants to work for government?? And we wonder why the country has a long term debt issue with pensions. Either you are fit to continue working after age 60 or you are not. Get your government salary or your government pension. Not both.

    • Anonymous says:

      I believe in Governments case they might bring them back but in most cases it is at a much lower salary. If they are brought back it is because they have special skills to offer that no one else can. Of course there are exceptions.

    • Anonymous says:

      for the record pension is something you have earned in the past salary is what you earn for something you are doing now. The biggest problem as I see it is in jobs for the younger people.

    • Anonymous says:

      Agree With 10.10. Remember the same should apply to,politicians. Unbelievable that they go on so about civil servants benefits and keep adding new benefits for themselves. Pension after one term! Lifetime medical. How do they justify this?

      • Anonymous says:

        Pension after 2 or 3 terms. Rescind the pension for all previous MLAs that only worked less than 2 or 3 whichever is decided. I am more pushing for 3 and MLAs can only run for a maximum of 4 terms. Also the pension is only received once they receive pensionable age, no earlier.